Cancellation of Articles and related Certificates

Purpose

This policy explains how to apply to cancel articles and the related certificate that have been issued under the Canada Not-for-profit Corporations Act (NFP Act).

Note

This policy is intended to provide information and set out guidelines. It is not intended to be a binding statement of what decision will be made on a particular application. It is also not intended to replace legal advice. You may wish to consult a lawyer or other professional to ensure that the specific needs of your not-for-profit corporation are taken into consideration when making an application.

Effective date

October 17, 2011

Cancellation of articles and related certificates containing an error or issued in error

The NFP Act allows the Director appointed under the NFP Act to cancel articles and related certificates that contain an error or are issued in error. For example, the Director can cancel a certificate that was issued to the wrong corporation.

Specifically, the Director may cancel the articles and any related certificates if:

  • there is an obvious error in the articles or in the related certificate;
  • the error was made solely by Corporations Canada;
  • the cancellation of the articles and related certificate is ordered by a court; or 
  • the Director did not have the authority to issue the articles and related certificate.

To cancel the articles and the related certificate, the Director must be satisfied that the cancellation would not adversely affect any of the members or creditors of the corporation.

If the above requirements are met, the Director will cancel the certificate upon receipt of:

  • a written acknowledgement from the corporations or any other interested person, confirming the need for the cancellation;
  • the original articles and related certificate with replacement pages, where applicable;
  • a statutory declaration of a director or an officer (or incorporator where no organizational meeting has been held) stating that:
    • the certificate has not yet been used or relied on; and
    • the cancellation would not prejudice any of the members or creditors of the corporation.

If necessary, the Director may seek additional information from the corporation in order to make a decision. For example, the Director may ask for a statement that no filings have been made under any personal property security legislation in Canada against the incorrect corporate name, or information giving assurance that the cancellation would not prejudice any of the members or creditors of the corporation.

Cancellation of articles and related certificates for other reasons

The Director has the authority to cancel articles and the related certificate for reasons other than they contained an error or were issued in error. The Director will approve the cancellation of the articles and related certificate only if the following conditions are met:

  • the cancellation is approved by the directors of the corporation (or the members acting pursuant to a unanimous members agreement);
  • the Director is satisfied that the cancellation:
    • would not prejudice any of the members or creditors of the corporation;
    • reflects the original intention of the corporation or the incorporators, as the case may be;
  • there is no dispute among the directors or members as to the circumstances of the request for cancellation;
  • the corporation has not used the articles and the related certificate or if it has used them, anyone dealing with the corporation on the basis of the articles and the related certificate has consented to the cancellation.

The Director will not cancel the articles or the related certificate to correct errors in judgment. For example, no cancellation will be permitted after a Certificate of Amalgamation is issued and the corporation realizes that the amalgamation was not a good decision or would like to undo the transaction.

To make a decision, the Director must receive a written request from the corporation or other interested person that includes the following:

  1. a statutory declaration of a director or an officer of the corporation (or the incorporators where no organizational meeting has been held) approving the cancellation and stating:
    1. that the cancellation has been approved by the directors of the corporation (or the members acting pursuant to a unanimous members agreement, or the incorporators where no organizational meeting has yet been held);
    2. that there is no dispute among the directors or members of the corporation concerning this request;
    3. if applicable, that the corporation did not authorize the filing of the articles that were filed;
    4. that the cancellation reflects the original intention of the corporation or the incorporators, as the case may be;
    5. that the articles were filed in error;
    6. how the error was made;
    7. that removal of the error by other means would cause undue hardship;
    8. that no members or creditors would be adversely affected by the cancellation; or if the cancellation may have an affect on the members or creditors of the corporation, a description of the effect the cancellation would have;
    9. if the cancellation would have an affect on the corporation's finances, information identifying the debt obligation holders before and after the issuance of the certificate, as well as the principal amount of each outstanding debt obligation before and after the cancellation;
    10. if the cancellation would have an affect on the classes or groups of members set out in the articles, information regarding the impact on the members in those classes or groups before and after the cancellation;
    11. where the cancellation could affect the corporate name, and the corporate name has not been used:
      1. no use has been made of the incorrect name (nor has it been referred to in any other document);
      2. the corporation has not signed any security agreements (link to glossary) or other similar documents using the incorrect name; and
      3. no filings have been made under any personal property security legislation in Canada, against the incorrect corporate name; and
    12. that the certificate has not yet been used or relied on.
  2. if the cancellation could affect the corporate name and the corporate name has been used (for example, in a contract between the corporation and a supplier): attach documentary consent to the cancellation from anyone who has dealt with the corporation on the basis of the corporate name;
  3. if the corporation has used the articles or the related certificate, attach documentary consent to the cancellation from anyone who has dealt with the corporation on the basis of the articles and the related certificate;
  4. the original articles and the related certificate, where applicable;
  5. in cases where the error was not made by the corporation itself, but by its representative to whom it had given correct instructions, the Director will, at his or her discretion, provide the requested cancellation upon receipt of all relevant documents mentioned above, along with:
    1. a statutory declaration of the representative indicating the instructions received and the reasons why those instructions were not reflected in the articles; or
    2. a statutory declaration of a director or an officer of the corporation (or the incorporators where no organizational meeting has yet been held) explaining why it is not possible to obtain a statutory declaration, as described in paragraph (i) above. The declaration must also indicate the instructions that were given to the representative and the reasons why those instructions were not reflected in the articles.

If necessary, the Director may request additional information from the corporation in order to make a decision.

Public records of the corporation

All documents filed with the Director, including those cancelled, are part of the public record of the corporation. No form or other documents, even those cancelled, will be removed from these records.

Court Order and Appeal

The Director, the corporation, or any interested person may apply to the court to cancel the articles or related certificates. There are no restrictions on what a court can order, although it will usually address whether or not the cancellation of the certificate is ordered and establishes the right of members or creditors of the corporation.

Any interested person who feels aggrieved by a decision by the Director to cancel or to refuse to cancel, the articles and the related certificate, may also apply to a court for an order requiring the Director to change the decision. The court has the power to order a change in the Director's decision.

Related Information

Fees

There is no fee to apply for a cancellation. However the Director cannot refund the fee that was paid to apply for the cancelled articles or related certificate.

Legislative references

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